Friday, September 09, 2011

All about the levels

We are bouncing from one gap fill to another. Yesterday we reversed off 120.8 resistance, and today we bounced (thus far anyway) on 117 support. If your time-frame is short, this isn’t chop, this is excellent opportunity. Here are the important, short-term levels on the $SPY:

#1: gap fill resistance we reversed on yesterday. #2 support gap fill that held today. #3 next support which is around 115.9 . #5 trend-line support near 115. Bulls don’t want to go to trend-line support so soon as one more test this early would probably break it this time. Soon one of these range-bound levels will stop holding (next trip to either side of the flag will probably do it) and then strategies will have to be shifted, but for now, enjoy the range.